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Indexes down: Dow 0.40%, S&P 500 0.36%, Nasdaq 0.51%

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US trade deficit surges to record high in March

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DoorDash ( DASH ) falls after $3.86 bln deal to buy Deliveroo ( DROOF )

(Updates with mid-session trade)

By Purvi Agarwal and Johann M Cherian

May 6 (Reuters) - Wall Street's main indexes declined on

Tuesday as investors tried to navigate the uncertainty

surrounding U.S. President Donald Trump's tariffs, while

awaiting the Federal Reserve's interest rate decision this week.

Trump said late on Monday he would announce pharma tariffs

over the next two weeks, his latest action on levies that have

roiled global financial markets over the past few months.

Eli Lilly ( LLY ) and Merck ( MRK ) slipped over 3% each,

while Pfizer ( PFE ) was down 1.7% after the news.

Indexes, however, were well above their session lows after

Treasury Secretary Scott Bessent said the administration could

announce some trade agreements as early as this week.

"The market is going to seesaw depending on tariff

discussions... we are susceptible to the news cycle with a lack

of actual fundamental things to trade on," said Mark Hackett,

chief market strategist at Nationwide.

"Until we get some news of actual deals being signed, we're

going to be susceptible to these fluctuations."

Tariff-driven uncertainty has led consumers, businesses and

even the Fed to adopt a wait-and-watch mode.

The Fed starts its two-day meeting on Tuesday, with the

central bank widely expected to stay put on interest rates.

Comments from policymakers will be scrutinized for any clues

hinting at where they stand on monetary policy easing this year.

Traders are pricing in a 25-basis-point cut only in July,

according to data compiled by LSEG.

At 11:42 a.m. ET, the Dow Jones Industrial Average

fell 168.75 points, or 0.40%, to 41,053.76, the S&P 500

lost 20.39 points, or 0.36%, to 5,629.99 and the Nasdaq

Composite lost 90.30 points, or 0.51%, to 17,753.95.

Most S&P 500 sectors were trading in the red, with

healthcare the biggest loser, down 1.7%.

In a bright spot, Constellation Energy jumped 9.8%

after its quarterly results, pushing utilities up

1.5%.

Shares of data analytics firm Palantir fell 12.5%,

to the bottom of the S&P 500, as investors were unimpressed by

the company's modest revenue beat and in-line profit.

Ford Motor ( F ) was the latest to suspend its annual

outlook on Monday, joining a host of companies that withdrew

their forecasts in April. The carmaker's shares reversed

premarket losses and were last up about 4% in choppy trading.

Hackett said investors were uncertain and confused as Ford

was in a complicated tariff situation but Trump's comments last

week on the auto industry being a big beneficiary was a

positive.

Against the uncertain trade backdrop, businesses boosted

imports of goods in March, pushing the country's trade deficit

to a record high of $140.5 billion.

DoorDash ( DASH ) was down 7.2% after the meal delivery firm

said it would buy Deliveroo ( DROOF ) in a deal valuing the

British rival at about 2.9 billion pounds ($3.86 billion). The

U.S. firm's quarterly revenue missed estimates, disappointing

investors.

Declining issues outnumbered advancers by a 1.12-to-1 ratio

on the NYSE and by a 1.62-to-1 ratio on the Nasdaq.

The S&P 500 posted 7 new 52-week highs and 6 new lows while

the Nasdaq Composite recorded 17 new highs and 75 new lows.

($1 = 0.7505 pounds)